Bangladesh Bank, the country's central bank has kept its key policy rate, known as repo rate, unchanged in its latest monetary policy amid rising inflation.

For the second half of fiscal year 2024-25, the policy rate will remain at 10 per cent.

In a bid to tame inflation, Bangladesh Bank has adopted a contractionary monetary policy, steadily raising interest rates in recent years.

On Monday, Bangladesh Bank Governor Ahsan H Mansur introduced his first monetary policy, acknowledging the challenge of reversing this ongoing trend.

The new policy sets the inflation target between 7 and 8 per cent, up from the previous target of 6.5 per cent.

For private sector loans, the target remains unchanged at 9.8 per cent. However, the target for government sector loans has been raised to 17.5 per cent, compared to the previous target of 14.2 per cent.

Mansur said that the policy rate will remain unchanged until inflation falls below 7 per cent.

He also acknowledged the public's concerns about inflation, assuring that the central bank is actively working to address the issue.